US Federal Reserve Chairman Jerome Powell said the argument for a sharp rise in interest rates was well-founded, noting that a possible 50 basis point (0.5%) increase in the Fed key interest rate would be considered at the May meeting. , as reported by Bloomberg.
“I would say the 50 basis points will be on the table at the May meeting,” Powell told the International Monetary Fund (IMF) in Washington on Thursday, attended by European Central Bank President Christine Lagarde and other officials.
“We are really determined to use all available tools to drive inflation back to 2%,” he said, recalling the Fed target.
Central bankers have been facing the highest levels of inflation in the world since the early 1980s after the coronavirus pandemic, exacerbated by the war in Ukraine and new lockdowns in China.
In the US, the consumer price index reached 8.5% year-on-year in March, the highest level since December 1981.
Fed officials are likely to give the green light at the May meeting for the Bank to start lowering its balance sheet, with a monthly limit of $ 95 million in bonds and mortgages.
Source: Capital
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